Yesterday morning, the Israeli Government pushed through 2 pieces of legislation despite the opposition parties putting up a 21 hour filibuster in an attempt to block it. One piece of legislation extends the 45 day time period for a newly formed government to pass a budget. The second implements a budget being passed every 2 years.
Budgets are very important. They allocate funds for government services and form a benchmark for evaluating performance. In the business world budgets can be matched against revenue for a true picture of success or failure. Preparing budgets 2 years in advance is a mistake that will further restrict the government's ability to adapt and implement government policy in the future.
The motivation for these changes is based on the fact passing budgets are hard. A government that cannot pass a budget automatically collapses. Small parties use this pressure to have a level of influence on the budget to be significantly greater than the amount of constituents they have. With the government being formed so close to going into the Passover vacation period the amount of working days before the original deadline was very tight. This legislation should have made some sort of consideration for the holiday seasons. The blanket extension is going to become a major problem at some point in the future. Tzipi Livni has said she would try to bring down the government on the 2010 budget. She will not have the opportunity until 2011.
The last year has proven that governments around the world need to be able to adapt to fast changing economic climates. Having a 2 year budget may be great for stability of the department for planing upcoming years but it does not mean that they will be receiving the funding they need. Over funding and underfunding become bigger issues as things move towards the end of the new budget cycle.
The government has still not passed the 2009 budget. Departments are running on a funding formula based on what they have received in the previous two years. With a 2 year budget the same scenario could with even more serious consequences. Departments could end be running on budgets that had been past almost 3 years earlier. Governments are already short sighted enough when setting policy. They don't have a chance of having enough foresight to properly plan for 2-3 years down the road.